Cello Health Share Discussion Threads

[qs99] 17/12/2018 08:27

Indeed. Who cares, they have gone and gone at IMO a silly price, fair play to MMs, now hopefully it can re-trace to £1.30....DYOR and GLA

[spooky] 13/12/2018 22:24

Where have Liontrust gone and what were they playing at, plonkers.

[qs99] 13/12/2018 22:15

all byyyyyyyyyyyyy myyyyyysellllfff don't wanna be.....stops singing...

[qs99] 13/12/2018 12:27

well I am enjoying being 15% up...

[qs99] 13/12/2018 12:10

will we get back to £1.30? DYOR

[qs99] 13/12/2018 08:31

Or just wanted out? You never really know do you. Either way it provided an opportunity if you believe the story, looks like it is now retracing IMO so roll on £1.30 again. Trouble with illiquid AIM shares, insti wants out, bang goes SP, but then off you go again as a PI if you are prepared to take the risk and back yourself if you believe it a good idea!!

[zipstuck] 26/11/2018 11:07

Lion trust appear to have lost trust.

[qs99] 23/11/2018 12:00

only me enjoying the ride here?

[qs99] 23/11/2018 09:46

Ok, so hopefully I'm right, looks like it may get back through a quid today, DYOR and all IMO naturally...

[qs99] 23/11/2018 08:35

here we go? DYOR

[qs99] 23/11/2018 08:18

levelled out yesterday/today, let's see how it unfolds next week, maybe seller cleared, not seen that volume for ages, but would at least partly explain that drop....DYOR

[nanceeuk] 22/11/2018 19:33

Majority selling - all the largest trades certainly. Is anyone aware of what has caused the massive sudden fall and sell off?

[coopstock] 22/11/2018 17:13

Massive trades today - buying or selling?

[qs99] 22/11/2018 15:41

that graph looks v. average to say the least! let's see where it levels out....

[qs99] 21/11/2018 15:45

Blimey what a fall, for no obvious reason IMO...wonder what the yield is now? 4%?

[spooky] 21/11/2018 11:49

Think its an active seller in a dead market, never a good combination. Does he know anything ? Perhaps, perhaps not, but the director buys suggest everything is fine. The last was less than a month ago.Standing in front of that sort of chart is always a bit brave though IMO.

[coopstock] 21/11/2018 09:23

Odd that mark Scott hasn't made some sort of supportive comment

[zipstuck] 21/11/2018 09:19

Wondering if the contractor tax and gdpr slowdown together with Brexit has stalled the UK business,

[qs99] 02/11/2018 15:31

bit of blue, perhaps people have noticed CEO buy and yield etc etc...?

[qs99] 01/11/2018 08:23

Unique position, growing, yield and wasn’t that the CEO buying a few quids of shares? DYOR but I have topped up as can see no obvious reason for the fall... DYOR

[coopstock] 31/10/2018 20:18

There was some director buying recently. So not what they were expecting.
But with the wider market going backwards these AIM stocks start to look costly.

[grahamite2] 31/10/2018 10:00

Glad to see this thread kept alive - good work, QS99!

[qs99] 31/10/2018 09:58

And since that note from Cenkos, the shares have slipped over 10%....

[davebowler] 19/9/2018 09:35

Cenkos;
Cello Health has released positive interim results in-line with forecasts, indicating FY18E will be another year of steady growth. The Cello Health business continues to make mid-single digit underlying GP progress, driven by positive market dynamics and a high penetration of the global healthcare community. Cello Signal’s digital expertise meanwhile are increasingly being leveraged into the healthcare space, giving rise to potential future margin appreciation. We expect the typical H2 weighting results to recur in FY18E in meeting our forecast +10% adj EPS growth.

n H1/18A results indicate another steady year: The group delivered steady progress in H1/18A, with gross profit (GP) growth of 3.9% to £51.0m and 9.3% growth in headline operating profit (HOP) to £5.3m, at a 10.4% (H1/17A: 10.0%) margin. Growth was tempered by weaker av. dollar conversion rates ($1.38 vs $1.26), where 30% of group GP is now earned in the US. We expect this to reverse in H2/18E, based on USD’s current strengthening. H1/17A comparatives did not include the acquisition of Advantage Healthcare (acquired July 17) and only 5 months of Defined Health (acquired Feb 17). LFL constant currency GP growth was 3.0% for the period.

n Cello Health – the engine room of growth: The Cello Health business continues to be the source of the group’s momentum. It delivered strong GP growth of 11.7% to £31.4m, or 7.2% on a LFL CC basis. HOP increased by 16.1% to £5.7m at a slightly improved margin of 18.0% (H1:17.4%). Both acquisitions continued to trade as expected and have been added to this month by the bolt-on acquisition of Firstlight Communications, for a minimal consideration. Firstlight produces communications programmes for pharma and med-tech clients in the UK and overseas.

Cello Health continues to make operational and financial progress through the recruitment of clinically-led professionals, the establishment of new US hubs and a more collaborative culture under one brand. It is also benefitting from positive market dynamics, where global healthcare R&D spend is increasing at c5% pa, with an ongoing trend by clients (particularly smaller biotech clients) to outsource some aspects of the commercial decision making process when bringing a drug to launch.

n Cello Signal increasingly servicing healthcare clients: Cello Signal delivered lower GP for the period of £19.4m (-2.0% YoY or -2.9% on a LFL CC basis) owing to loss of income from the downsizing of unprofitable US West Coast activities in FY17A. This did however contribute to a 3.9% rise in HOP to £1.2m, at an improved margin of 6.4% (H1/17A: 6.0%). We expect the seasonally stronger H2 delivery in Signal to recur this year and lead to FY18E margins of 10%+. The development of Signal’s offer for healthcare clients is gaining considerable traction, with Signal’s non-healthcare orientated staff buying into the commercial opportunity following several new wins in the space. Pulsar, particularly, is demonstrating how Signal’s digital skillsets can be applied in the healthcare space, with the social media analytics tool being used for pitches, in combination with Cello Health.

n Cleaner set of numbers expected this year: We note today’s results include reductions in certain below the line items compared with previous results (eg restructuring provisions, start-up losses, VAT exceptionals), narrowing the gap between statutory and underlying reporting. We also expect the full year results to mirror this trend in line with our FY18E forecasts.

n Forecasts unchanged: The group traditionally exhibits a modest H2 weighting to results (particularly Cello Signal) and we note that 49% (H1/17A: 48%) of FY18E GP and 42% (H1/17A: 41%) of HOP has already been delivered in these results. We therefore consider this to signify in-line trading, and thus leave our forecasts unchanged, save for an update to share count. We expect the group to deliver a +10% uplift in adj EPS and +3% uplift in DPS this year.

n Valuation – yet to account fully for the recurring nature of income: Cello currently trades on an FY18E P/E of 15.5x, or 9.3x on an EV/EBITDA basis. We consider these multiples to fail to take account of the degree of habitually recurring income Cello generates based on multi-year Master Service Agreements (MSAs) with its clients. These, combined with Cello’s penetration into 24/25 of the top big pharma players and an increasing number of high growth biotechs, gives the group a diverse and recurring annuity-like income. This quality of earnings benefits a valuation multiple more akin to larger listed healthcare services peers such as UDG Healthcare (FY18E P/E: 18.8x) and those competitors domiciled in the US (typically 20x+ P/E’s).

[eentweedrie] 18/9/2018 11:31

lets see what tomorrow brings!